Benon Sevan, former head of the United Nations' Iraqi oil-for-food programme, took almost $150,000 in illicit oil-related cash payments in concert with two Egyptian businessmen, the UN's independent inquiry alleged yesterday.

The findings came a day after Mr Sevan resigned, insisting it was not credible he would have compromised his career for such a sum.

The inquiry committee - chaired by Paul Volcker, former chairman of the US Federal Reserve - also said it would continue to investigate evidence that raised further questions about how much Kofi Annan, UN secretary-general, knew of efforts by Cotecna, which employed Mr Annan's son Kojo, to win a UN inspection contract.

"Our conclusions are obviously significant and troubling," Mr Volcker said yesterday. He said he would ask the secretary-general to strip Mr Sevan of his immunity from prosecution.

Mr Sevan "had knowledge that some of the oil was purchased by paying illegal surcharges to Iraq in violation of United Nations sanctions", the committee said.

It had traced the trail of proceeds from African Middle East Petroleum's (Amep) sale of about 7.3m barrels of Iraqi oil to a Swiss bank account that was controlled by Fred Nadler, a friend of Mr Sevan.

It says about $257,500 (€208,000, £144,000) in cash withdrawals were made from this account between late 1998 and late 2001, during periods when Mr Sevan and/ or Mr Nadler were in Geneva and preparing to return to New York. These withdrawals were soon followed by cash deposits totalling $147,184 to the bank accounts of Mr Sevan and his spouse in New York, the committee said.

"On the basis of available evidence, the report concludes that Mr Sevan corruptly benefited from his request and receipt of Iraqi oil allocations, and that Mr Nadler and [Fakhry] Abdelnour [Amep's head] financially benefited from and assisted in Mr Sevan's corrupt activity."

The panel added that Mr Sevan and Mr Abdelnour had stopped co-operating with the inquiry, while Mr Nadler had declined to respond to any of the committee's requests.

A previous report said both Mr Nadler and Mr Abdelnour were related to former UN secretary-general Boutros Boutros-Ghali. But the latest findings should not be "construed as an opinion that other members of the Sevan or Nadler families acted in a way that was wrong or improper".

Mr Sevan, who is in Cyprus, has expressed disappointment at Mr Annan's "expedient abandonment of Mr Sevan in the face of a politically motivated investigation". He says he would not have compromised his career for so little.

But the report notes that "from mid-1997 through November 1998 the Sevans' finances were frequently stretched thin from the monthly burden of funding two residences, debt obligations, credit card charges, and related living expenses".

During the period of alleged corruption, their situation improved, with regular deposits made to their accounts. But "once the oil stopped flowing for Amep, the cash soon stopped flowing into the Sevans' accounts".

The report also says Mr Sevan played an important part in helping Iraq win $300m for oil spare parts. It added that he expressed displeasure in late 2000 at suggestions by the UN spokesman that the Iraqi regime was imposing a surcharge on oil sales , saying it "threatened to chill efforts by the secretary-general to entice the regime to co-operate".

And, as allegations of kickbacks mounted, Mr Sevan's office told a Security Council committee there was "no hard proof to corroborate" them.

"If criminal charges are to be brought against Mr Sevan, the prosecuting authority will need to obtain a waiver of Mr Sevan's immunity," the report said. "The committee recommends that the secretary-general accede to any properly supported request from an appropriate law enforcement authority for such a waiver."

The Volcker committee also found evidence that Alexander Yakovlev, a UN procurement officer, "actively solicited" a bribe in connection with the programme, as well as accepting illegal payments from UN contractors outside the programme.

Mr Yakovlev, the report alleged, "secretly participated in a scheme to solicit a bribe from Société Générale de Surveillance (SGS), one of the companies that submitted a bid for the oil inspection contract.

"Mr Yakovlev furnished confidential bidding information to a friend of his in France, Yves Pintore, who in turn approached SGS to see if SGS would work with him and influential people in the UN in New York."

There was no evidence SGS paid a bribe. Mr Yakovlev also received more than $950,000 in payments from various other UN contractors, the report said.